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Trustworthy – Can it be a New USP for Offshore Vendors?

Ten years back most of the offshore clients used to talk very high about transparency and candidness of Indian IT companies. Frustrated with either high- handedness of firms such as Accenture or total opaque deals of EDS and IBM; they were pleasantly surprised with Indian providers’ upfront and sincere service approach. In fact many clients signed up with Indians because they found these new, though very small vendors, quite easy to work with. Apart from low cost and abundant talent, I believe, this honesty and simplicity helped Indians enter and grow in many accounts in late 90s.

As industry evolved, top firms grew to become multi-billion in revenues; projects became complex and client evaluation criteria changed. With time, client praise regarding these characteristics of Indian vendors stopped. I am not saying that Indians too became less transparent or turned a blind eye to their clients, but these factors were either taken for granted or were no more a differentiator.

None the less, in last few months I am observing some subtle signs of few of these factors re-surfacing in a new avatar. However, our research shows, it is not an industry-level trend at this stage. Also on deeper digging we found its Tata Consultancy’s (one of the) new strategy of winning over the competition. Arguably a well thought plan! Here is how :

Over past two-three months we heard few clients (knowingly or unknowingly) mentioning about TCS staffers bringing in more transparency in the project reporting. Clients found even TCS waving flag regarding the possible challenge or delay. Couple of clients even mentioned about them proactively high-lighting some of the possible issues which may hamper the work and steps they have taken. They expressed their happiness about extra effort that TCS took in making client aware of the project status. Initially, like a cynical analyst, I shrugged-it-off as one of an instance. However, when the number climbed up to double digit clients we pondered if this is just a coincidence or something else.

This feeling got strengthened in our last few interactions with TCS. Currently we have multiple research projects going on. We have also been interviewing several vendors, including TCS, on various aspects – overall IT landscape, Big data, OPD, and ERP. In every briefing with them in this connection, we realized that TCS has been much more upfront and transparent than ever in past… we noticed they took extra pain to tell us what they have not yet achieved, what failures they had, what part of their presentation/strategy is still incomplete or in-works, where have they gone wrong and whether they have totally recovered from that or not. It was so different from the typical vendor–pitch, that an analyst gets in such research projects that we started noticing it and automatically began to connect it with the few, anecdotal stories we heard from clients.

I felt the best way to find whether this was a coincidence or some thoughtful action will be to ask TCS about it. As expected, initially they were very reluctant to talk about it. But when pushed further and after assembling the pieces, from our multiple conversations, we got some details. TCS is historically very conservative in trumpeting on such things, but based on client feedback and research interviews, our assessment is:

This is a well thought strategy. They want to go that extra mile to make a point with client. They want to prove they are an upfront, honest, and sincere ‘client-centric’ firm. To achieve that, they have identified few areas in client facing functions such as status reports, change orders, proposals and executive meetings, where they not only pitch their success and achievements in the project, but also indicate challenges, issues, and failures over and above what is expected in pre-decided reports.

They feel it is required to win over business buyers. TCS leadership, we believe, thinks that CIO organization in client accounts fairly believes in their capability. But since now decisions and budget control has shifted to business units and CFO, they feel they need to take extra steps to win confidence of this new buyer class. For that, TCS thinks building credibility and trustworthiness is a key step.

In a way, this has come from very top. TCS Chairman Mr. Ratan Tata (who, we believe, has become active in the company) has stressed about being client trust worthy in several internal leadership meetings and their CEO, N. Chandrasekaran regularly follows up on what steps TCS is taking to achieve that.

The question is not whether Indian companies are honest and transparent. Undoubtedly, most of them are. But can some of these characteristics – such as transparency and trustworthy – will work as a differentiator and help to create a unique client experience. Will it help business buyers to rely on offshore providers for the work that they historically gave to Accenture and IBM and expect them to deliver the value that they now expect from IT. Most probably, TCS is doing this consciously as a part of – what they call – ‘enhanced client centricity’ and to earn extra points. We feel this plan, which in a way is “back to basics”, is a good move and our early assessment indicates that this indeed will help TCS as clients are taking a note.

PS – Please wait for 2 weeks for more details on Indian vendor landscape. We are publishing two strategic reports on this subject:
1. Strategic Review of Top Four Indian IT Services Providers
2. Decoding TCS’ Transformation from “Order Takers” to “Strategic Partners”

16 thoughts on “Trustworthy – Can it be a New USP for Offshore Vendors?”

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If you are working on any Agile project team then transparency is part of Agile practices which everyone follows. There are many software companies which work in Agile model and have been successful in gaining the client confidence on almost every project they do.